Whenever you are looking for more advanced functionalities like smart contracts and applications, ethereum is the best for it.
In the year 2015, this has been presented in the market. It is made not only for decentralized payment but also for attaching computer codes which validate applications and financial statement.
Ether is the ethereum cryptocurrency that controls ethereum contracts and applications. Similarly to bitcoin, the ethereum network is employed under blockchain technology. Only that, in the blockchain, it contains a programmable language that now enables it to make and install applications.
The difference between Bitcoin and Ethereum
Since ethereum is a highly improved cryptocurrency, it contains a lot of difference from the set ground of digital coin, which is the bitcoin. Here are now the differences between ethereum and bitcoin.
1. When it comes to the algorithm, ethereum utilizes ethash. Whereas, bitcoin uses the SHA-256. This is used to protect blockchain in bitcoin cryptocurrency. Whereas, the ethash encrypt is for the security of blockchain in the Ethereum network.
2. Ethereum transacts faster than bitcoin as it takes only seconds rather than minutes.
3. Etheruem and bitcoin differ in their general aims. Bitcoin is made to be an alternative digital coin. Whereas ethereum is an operating system that facilitates decentralized application and ethereum codes itself. The same way that the security it creates is to turn into money.
Ethereum is supporting the bitcoin network. That is why it should not be competing with bitcoin. However, it gains almost near market cap from the bitcoin for halfway of 2015. And this attributed to its popularity. Given that ethereum is a newborn cryptocurrency, we can’t run from the fact that its system is smaller than the bitcoin. Last January of the year 2020, the market cap of bitcoin is almost 147 dollars, while there are only 16 billion dollars.
Like any other cryptocurrency, you can also directly buy ether from a fiat currency. In some countries like in New York, you can personally buy or sell an ether from someone.
The other option is to purchase bitcoin and trade in exchange for ether. This may take some steps as you will look for the best and legitimate cryptocurrency exchange available in the market. The transaction also charges depending on the amount of coin and the exchange company you are dealing with.
Of course, you have to secure your private keys to keep the ether safe. There are lots of ethereum wallets available. And this may depend on your preferences and convenience.
This type is incorporated in your laptops and PC. To have it, the complete blockchain ethereum should be downloaded. This will take some days to work; that is why the wallet should be sync to keep the latest transaction.
If you want to keep your ether offline, you can have these security devices. You can transact without doing any online service. It can be detached so you can put it in a more protected place. One advantage that you may encounter is when you take transactions frequently, so in that case, you may not have your ether with you to fuel some ethereum network.
When we store private keys offsite in a mobile device, this is known as the cold storage. This can be suitable for you if you only need less information that can transact in the ethereum network. Having so, you are the one validating or receiving information, which makes it an advantage. However, since we are putting ether in a mobile device, it can’t be easily used.
You may print or just copy a private key and after store it in a deposit box. Unlike with online wallets, if the site is hacked, you can lose your private keys or your ether itself, but that is not the case in a paper wallet.
How Smart Contract for Ethereum Works?
Let us define what smart contract is before anything else. So, when we turn into a usual contract, we are into a relationship to follow certain terms given by law. In a smart contract, we strengthen the relationship by putting cryptographic codes.
When ethereum is not already present, we know that bitcoin also allows the transfer of money, but it is limited only for that.
Whereas ethereum has incorporated a new set of a scripting language to compensate that limitation. And this is what we call the “Turing-complete” which can hold more complex computational instructions.
A smart contract can keep data, such as membership records. It can also give service to another contract as the one happens in the software library. It may also regulate agreements and tell if someone purchases insurance from other companies. A smart contract only works when encrypted by enough number of people agree.
This is how to say that ethereum facilitates the exchange of money, shares, content, or even property. And since the smart contract is under blockchain, it automatically programs without any downtime, third party, or censorship.
Why should we invest in Ethereum?
Since ethereum can run any algorithm, it is the best digital cryptocurrency to support programs and applications. Today, investors are continuously incorporating this technology to have a flexible way not only to make money but also to provide fuel for decentralized applications.
Thus, ether is treated as a “digital oil” that can level up your experience. Ether itself can be used to pay for computational resources.
Since it has a virtual machine, ethereum itself speeds up any commercial enterprise. For that reason, the response can be instantly achieved regardless if it is a demand or payment.
Ethereum has produced an application to help customers securing any bank transaction like in the case of the Bank of America. Indeed, it is a great and promising network which can make our transaction secured.